The commission said it had received assurances at the beginning of 2013 that border checks would be "proportionate", but said it had suggested "a technical meeting with the Spanish authorities in order to address the issues raised by the border checks, including the alleged excessive waiting times".

Mr Garcia-Margallo also hinted at the introduction of other measures, including tax investigations into property owned by Gibraltarians in neighbouring parts of Spain, and the closing of Spanish airspace to flights heading to Gibraltar.

Mr Cameron said none of the measures had been raised with the UK government, while Mr Picardo has accused Spain of "sabre-rattling".

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Media captionThe BBC offers a quick guide to why Spain and Britain are at loggerheads over Gibraltar

Fishing row

Gibraltar has linked Spain's tough stance to the creation of an artificial reef in waters off Gibraltar.

Last month, Gibraltar dropped 70 concrete blocks into the bay to create the reef, but Spanish fishermen, who trawl the area for shellfish, say the move has prevented them working.

Spanish authorities said the blocks had been laid "without the necessary authorisation".

BBC political correspondent Alan Soady said Mr Cameron's government believed the reef dispute was a matter for Gibraltar and so felt it would be inappropriate to be directly involved in decisions on the fishing issue.

Instead, he said a Foreign Office source had told him it was involved "from a foreign policy perspective and to provide any support or advice the government of Gibraltar asks for".

Nevertheless, he said, the UK government wanted to be seen to be responding to the border checks issue, hence the serious language being used by the prime minister.

The European Commission said it did not have enough information to comment on the proposed border fee, but the UK's shadow foreign office minister Kerry McCarthy said any such move would be "unacceptable".

Earlier, Sir Graham Watson, a Lib Dem MEP for the South West of England and Gibraltar, said he had written to Jose Manuel Barroso, president of the EU Commission, asking "for his personal intervention to stop such objectionable behaviour by an EU government bullying EU citizens".